From Double-Digit to Single-Digit Unemployment in Morocco: Will the Youth Benefit?
22 Feb 2008 in Employment
Brahim Boudarbat is Assistant Professor of Economics in the School of Industrial Relations at the University of Montreal.
The situation of the Moroccan labor market significantly worsened during the 1980s and 1990s propelling the unemployment rate to 16% in 1999. Since the start of the new millennium, the trend has been reversed -- creating hope for a brighter future to thousands of people who are either currently unemployed or who will soon be on the job market. The unemployment rate dropped more than 6 percentage points, and for the first time in 35 years it went bellow 10% (9.8% in 2007, 8.8% in 1971).
The situation of youth aged 15 to 24 also improved. The labor force participation rate of this population sector dropped eight percentage points between 1999 and 2006 going from 48.0% to 40.1%, signaling that youth are staying longer at school. In parallel, their unemployment rate dropped 5 points going from 20.5% in 1999 to 16.6% in 2006. However, their situation remains very precarious in urban areas with a staggeringly high unemployment rate of 31.7% in 2006.
In fact, the Moroccan labor market is characterized by two main features: the first is the great gap between the urban and the rural unemployment rates: the former being 4 times higher than the latter (15.4% versus 3.8% in 2007). The situation of almost full employment in rural areas is far from being beneficial to youth who are often deprived from school in order to be employed at an early age as unpaid family workers. Yet, those who attend school (in both urban and rural areas) continue to be at a high risk of being unemployed after graduation. This would explain the second characteristic of the labor market. In 2006, the unemployment rate among workers with university degrees was 4.5 times higher than among uneducated workers. Interestingly, the ratio of the unemployment rates of urban/rural and university/uneducated stayed the same between 1999 and 2006.
This structure of unemployment, which is favorable to uneducated workers in both rural and urban areas, is one of the main problems facing the Moroccan economy. It certainly interferes with education, possibly dooming youth to a future of poverty. It is difficult to incite youth and their families to invest in human capital when education reduces employability. Recently, the Minister for Education recognized that the education policy did not achieve the anticipated goals. Indeed, the attendance rates for children in school remain weak: 59.5% at the pre-school level (children aged 4 to 5 years), 94% at elementary school (grades 1 to 6), 74.5% at the second stage (grades 7 to 9) and hardly 48% at the secondary school (grades 10 to 12).
A substantial improvement in the outcomes of educated workers must take place if we are to reduce the exclusion and vulnerability of Moroccan youth. While an increase in employment is important, it is not sufficient (notice that two thirds of the poor population live in rural areas despite the fact that rural areas experience a very low unemployment rate). A better integration of educated people in the labor market will entice a high level of investment in human capital, which is favorable to growth, employment, and greater investment in human resources.
Data on the labor market are from the Moroccan Labor force survey. Detailed reports from this survey (1999 to date) are posted on the website of the "Haut Commissariat au Plan" with free access (www.hcp.ma). Data on schooling rates were reported by the Maghreb Arab Press (the official source of news in Morocco) on Feb. 12th, 2008. Finally, data on poverty in rural areas are from "Repères Statistiques, # 47, July 2000, Direction of Statistics, Morocco."
